Comment by mw1 | Hacker News Reader

Comment by mw1 | Hacker News Reader

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One reason you may need to continually plead with people about this is because so many of us have had lived experiences with valid medical claims that should be covered under our policy, denied outright. Not a health insurance company saying “oh, that’s too expensive, go here for less,” but outright denial of coverage. And if we eventually succeed in having these claims covered, it is because we were willing to spend countless hours combing through paperwork, initial delays, and denials.

Also, the same CMS statistics you cite can be combined with other reports to conclude that 500 billion dollars of excess administrative costs PER YEAR are attributable to our lack of a single payer system — something UHC has lobbied heavily against in order to protect their profits over the improved health care of the average American. You can read the numbers here:

https://www.peoplespolicyproject.org/2024/12/10/health-care-...

“private insurers currently have administrative costs that are 1,000 percent what they would be under single-payer while hospitals currently have administrative costs that are 158 percent what they would be under single-payer. The excess administrative expenses of both the payers and the providers are because of the multi-payer private health insurance system that we have.

When you add it all up, excess administrative expenses — defined as administrative expenses we have under the current system that we would not have under single-payer — are equal to 1.8 percent of GDP, or $528 billion per year.”

Another reason your pleading falls on deaf ears is that, sure, provider payments can be reduced (and this addressed in the above article), but at the end of the day, private insurance is a purely rent-seeking enterprise that provides no value to Americans while these “overpaid providers” are actually delivering the care.

2.21 trillion dollars per year of provider costs, against 279 billion dollars net cost of health insurance.

But yeah, the one player in this market that has its profits capped statutorily, they're they're the whole problem, no matter what the numbers say. Sure.

I'm not telling you there's no problem. I'm saying that you've been conned into believing the problem is something it isn't.

The article I posted did not claim they were the whole problem, nor did I.

They are, however, a large part of the system that no one likes to deal with and can be fully eliminated without obvious negative consequences.

Health insurance doesn’t provide health care and is a purely extractive rent-seeking business. The article I posted even explains how single payer can help drive health care provider rates lower, as you now have a single, powerful entity (Medicare) negotiating against doctors, hospitals and drug companies.

And this “one player” (health insurance companies) heavily lobby against the implementation of single payer health care system. And their profit caps ensure that their goal is to grow the cost of medical care so they can take an ever higher profit in absolute dollars.

Yes. They're a part of the problem. Specifically: they are less than 10% of the problem. If you replaced them with Medicare, you would get somewhere between 1-5% off your health care bills, if everything went optimally.

Meanwhile: we are commenting on a story about someone murdering a health insurance executive.

> Meanwhile: we are commenting on a story about someone murdering a health insurance executive.

Is this surprising? Motive is always of interest after a high profile crime. And apparently it requires assassination with manifesto to bring these robber barons into the spotlight. The only thing I find surprising is the use of a 3D printed gun instead of just buying one from a show or local gun store.

The article I posted makes a case that eliminating private health insurance will be VASTLY more than 5% savings and people can read the article to see why.

You’re choosing to avoid all of the other cost savings that will come from eliminating private health insurance and having a single payer who can effectively negotiate with providers without the goal of taking a slice of profits from an ever bigger pie.

You're citing Matt Breunig's figures about how much more efficient Medicare would be than private insurance. But the truth is, mechanically, the opposite. Medicare's efficiency is a statistical illusion. Administrative overhead is a simple ratio of fees paid to services rendered. The more services you render, the better your admin costs look. And Medicare's look good indeed, because virtually everyone in America over the age of 65 is covered by Medicare --- that's the point of the system, to do single payer at the point where costs suddenly ramp up. If you let people enroll in Medicare at age 25, they would incur lower service costs, while paying the same in fees. If you do the math, Medicare for a 25 year old looks a lot like private insurance for a 25 year old.

Meanwhile: all insurance costs, in the whole economy, across all of national health expenses, total less than 10% of costs overall. Providers drive all the costs in our system, not insurers. But Breunig is fixated on his preferred solution, so he's not telling you that. But the numbers are right there if you want to see them; just search [National Health Expenditures by Type of Expenditure and Program: Calendar Year 2022].

I honestly don't care if you want Medicare vs. private insurance. I don't love my insurer. But if you zero out the total cost of insurance, public and private, you barely make a dent in our health costs. There is no way around it; the numbers are stark.

Personally, I think the balance we've struck in our payment system --- private markets until age 65, at which point the state steps in --- is pretty smart. Our system is fucked, of course, but that's because health provider chains have been ripping people off for decades.

> Providers drive all the costs in our system, not insurers.

I like your proposed solution that the state somehow engineer a way to drive down the costs billed by providers. Perhaps if the state operated a (pseudo-)monopsony wherein they exercise their leverage as the payer to drive down costs.

It could have a snappy name like if you combined medical and care? Or maybe medical and aid?

Anyway I also cannot fathom why anyone would hold ill will towards an industry that lobbies to stop that from happening. They are simply smol beans and the fact that there is no single payer monopsony means they are splitting a measly fraction of a trillion dollars per year. The fact that somebody else makes money too is proof that they couldn’t be a problem uwu

You are fighting a losing argument created by health insurance companies because they've created years of self-inflicted wounds. Everyone believes health insurers are the problems because almost everyone has dealt with the nightmare of valid claims being denied.

Health provider chains rip people off because that's how they maximize earnings from insurance companies. Insurance companies maximize denials because that's how they maximize profit. You remove one side from the equation and the problem of provider costs becomes easier to solve.

And as an aside, I dealt with my mother being denied healthcare from her insurance provider because they determined her stroke was a pre-existing condition.

There is simply no logical argument you can ever make that will change my opinion.

It is, obviously, exactly the other way around: the system is rigged to maximize earnings for health provider chains. I honestly don't see how you can look at the numbers and come to the other conclusion.

'Won't someone think of the poor rent seekers' is not nor will it ever be a compelling argument. The only way this problem can be solved is in the same way every other country solves it: Either tearing out private insurance and fully socializing healthcare or strongly limiting private insurance and having a public option which negotiates and keeps prices low.

You can argue that health providers charge too much and that's true. But the core of the rot comes from the health insurance scheme we've cooked up. And people rightfully blame the insurers for this problem.

Maybe if they dislike it so much they can put a fraction of the billions they're earning towards bribing politicians for a public option rather than constantly spiking things like that whenever they get a chance.

Health insurers make an order of magnitude less than providers, and our providers charge 3-5x more than European providers, but somehow insurance is "the core of the rot"?

Correct. See: my experience with pre-existing condition denial.

OP said the "health insurance scheme we've cooked up" is the core of the rot - not insurers' on their own, but rather the whole regulatory environment ("we") that enshrines the dynamics of HMOs, imaginary prices, and whatnot.

I agree with a lot of what you are saying. Trying to demonstrate some common ground - my (somewhat shallow) reading of the Anthem Anesthesia issue aligns much more with your analysis than the pop narrative.

But how exactly is the denial of care suppose to function as a price feedback mechanism to form a working market between providers and insurers? Is an MRI provider supposed to be thinking that if they lower their prices by 10%, the insurance companies will increase the number of approved MRIs to make up for it? And this still ignores that prices are not the same as profit margins, which is a huge hand wave here. Also if those denied MRIs were truly unnecessary, then how would paying for them merely because they cost a little less make sense?

Which is the crux of where my original comment was coming from. The responsibility of deciding necessary medical care needs to be laid at one decision maker (eg the treating doctor serving the patient per their code of professional ethics while fundamentally still working for the insurance company), rather than this split-brain blame game between the patient-facing doctor having little downside to saying yes, and the back office "doctor" at an insurance company having little downside to saying no. An insurance company shouldn't really even have its own opinion on something decided by a medical professional they're already contracting with, especially when that opinion has been created purely based on formulaic paperwork processing. At most they should be able to refer the patient to a different provider to perform the service, or withhold some payment for the service per their contract with the provider (but invisible to the patient).

This is obviously not the only reform we need to get any sort of price signals and sane division of responsibility in this industry. Because yes, provider costs are the main problem and they've been marching ever upwards. But every one of these terrible dynamics that has been allowed to fester is in need of its own reform, especially if you aren't advocating for the blanket approach of single payer.

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